2022 NECO Accounting Questions and Answers
(i) Discount allowed is granted by the seller to the buyer.
(ii) The discount allowed is the expense of the seller.
(iii) Discount allowed is debited in the books of the seller.
DISCOUNT RECEIVED
(i) The discount received is received by the buyer from the seller.
(ii) Discount Received is an income of the buyer.
(iii) Discount Received is credited in the books of the buyer.
(1b)
(i) Cash book
(ii) Purchases book
(iii) Sales book
(iv) Purchases return or return outwards book
(v) Sales return or return inwards book
(1c)
ERROR IT REVEALS
(i) Wrong Totaling of
(ii)Subsidiary Books
Posting of the Wrong Amount
ERROR THAT DOESN'T AFFECT IT
(i) Error of principle
(ii) Error of commission
(iii) Error of omission
2022 NECO Accounting Questions and Answers
(2)
(i) Accumulated fund: An accumulated fund is a type of account that serves as the repository for funds that are collected over time by non-profit organizations and are above and beyond the money needed to cover operational and other expenditures.
(ii) Depreciation: It's the reduction of a recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible.
(iii) Nominal Capital: It's the amount of capital that a business can offer to shareholders, in the form of shares of stock. In most nations, the amount of this nominal share capital is regulated by governmental agencies that determine the financial stability of the business and the company’s ability to cover the value of those shares.
(iv) Bad debt: Bad debt is an expense that a business incurs once the repayment of credit previously extended to a customer is estimated to be uncollectible and is thus recorded as a charge off.
(v) Net profit: is the amount of money your business earns after deducting all operating, interest, and tax expenses over a given period of time.
2022 NECO Accounting Questions and Answers
(2)
(i) Accumulated fund: An accumulated fund is a type of account that serves as the repository for funds that are collected over time by non-profit organizations and are above and beyond the money needed to cover operational and other expenditures.
(ii) Depreciation: It's the reduction of a recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible.
(iii) Nominal Capital: It's the amount of capital that a business can offer to shareholders, in the form of shares of stock. In most nations, the amount of this nominal share capital is regulated by governmental agencies that determine the financial stability of the business and the company’s ability to cover the value of those shares.
(iv) Bad debt: Bad debt is an expense that a business incurs once the repayment of credit previously extended to a customer is estimated to be uncollectible and is thus recorded as a charge off.
(v) Net profit: is the amount of money your business earns after deducting all operating, interest, and tax expenses over a given period of time.
2022 NECO Accounting Questions and Answers
(3a)
(i) Goodwill:
Goodwill is an intangible asset associated with the purchase of one company by another. Specifically, goodwill is recorded in a situation in which the purchase price is higher than the sum of the fair value of all visible solid assets and intangible assets purchased in the acquisition and the liabilities assumed in the process.
The value of a company’s brand name, solid customer base, good customer relations, good employee relations, and any patents or proprietary technology represent some examples of goodwill.
(ii) Fictitious asset:
Fictitious assets have no physical existence or realisable value, but the company shows them as a cash expenditure in the books of accounts. They are a part of the assets column in the financial statements, and they are expenses or losses that do not get written off during the accounting period of their occurrence.
(iii) Gross profit:
Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. Gross profit will appear on a company's income statement and can be calculated by subtracting the cost of goods sold (COGS) from revenue (sales). These figures can be found on a company's income statement. Gross profit may also be referred to as sales profit or gross income.
(iv) Turnover:
Turnover is an accounting concept that calculates how quickly a business conducts its operations. Most often, turnover is used to understand how quickly a company collects cash from accounts receivable or how fast the company sells its inventory.
2022 NECO Accounting Questions and Answers
(v) Balance sheet:
The term balance sheet refers to a financial statement that reports a company's assets, liabilities, and shareholder equity at a specific point in time. Balance sheets provide the basis for computing rates of return for investors and evaluating a company'
2022 NECO Questions on Accounting
SECTION A
1a) Differentiate between Discount Allowed and Discount Received.
b) identify five subsidiary books of account.
c) List two errors that the trial balance can reveal and three errors that does not affect it.
2 Explain the following Accounting terms:
(i) Accumulated fund
(ii) Depreciation
(ii) Nominal capital
(iv) Bad debt
(v) Net profit
3 (a) Write short note on the following:
(i) Goodwill
(ii) Fictitious asset
(iii) Turnover
(iv) Balance sheet
(b) Complete the following table showing which accounts are to be credited and which to be debited.
Accounts to be debited Accounts to be credited
(i) Bought motor van for cash
(ii) bought office machinery on
credit from Yuguda
(iii) Introduced capital in cash
(iv) A debtor Ade pays his account by
cheque
(v) Paid a creditor, Niyi in cash
4 (a) Who is a consignee?
(b) Identify three components of fixed assets and two of current assets
(c) List ten users of Accounting Information
SECTION B
(Accounting Practice)
5. The following balances were extracted from the books of Joseph K.B. a manufacturer for the year ended 31st December, 2012.
DR CR
Stock at 1st January, 2012:
